Urbanation recently reported that during this year's first quarter, an all-time high of 71,378 condo units in 242 projects were under construction in the GTA. And as of January, industry advisory RLB counted 104 cranes adding to downtown Toronto's skyline, more than New York, Los Angeles and Chicago combined.

Watch: This office space is what passes for a one-bedroom rental in Toronto. Story continues below.

The Toronto condo boom is hard to ignore.

But Stephen Brown, senior Canada economist for Capital Economics, an economic-research firm, suggests slowing new home sales will limit future construction in the country's biggest city.

Eventually that will eat away at national economic-growth prospects as similar patterns play out in other major markets.

"As most new home sales are pre-construction condos, the continued weakness means total construction will decline in the coming years as more units are completed than started," he writes in a report this week. "This process means that residential investment in Toronto will fall," he adds.

The "continued weakness" Brown is referring to was on display with the release of Altus Group's latest market data for the new-home segment of the GTA. Researchers with the company found that 1,428 new condo apartments sold in March, a decline of 13 per cent from activity a year ago and 34 per cent short of the decade average.

"With similar trends likely in Vancouver and other cities in Ontario and British Columbia, residential investment will continue to be a drag on GDP growth even if sales start to improve," Brown explains.

Demand is holding up

At least for now, competition for affordable homes among millennials, international migrants, and downsizing baby boomers is spurring residential investment, according to a recent BMO note.

However, the Canadian economy is already underperforming. Canada's GDP shrank by 0.1 per cent in February compared to the previous month.

Weaker-than-expected fourth-quarter GDP data led to a change of tone from Canada's central bank. Previously, the Bank of Canada had suggested it would continue gradually increasing interest rates this year, a plan it started in the summer of 2017.

"We still doubt that the Bank's hopes of a strong rebound later this year will materialize, which will eventually force it to cut interest rates later in the year," writes Paul Ashworth, Capital Economics' chief North America economist, in a separate report.